Gen Z active in wealth creation but lacks independent insurance protection: Report
New Delhi, June 29
Roughly 51 per cent of Gen Z individuals operate as proactive investors who actively allocate capital into mutual funds and systematic investment plans, yet a significant reliance on parental insurance continues to delay their transition to independent protection.
According to a research report by Bajaj Capital, 29 per cent of this demographic utilize financial applications and 26 per cent track influencers to source answers, though their journey consistently halts at the research stage. The final conversion from digital browsing to actual product purchase remains low despite high overall information access.
The report mentioned that a stark reality exists for Gen Z because their underlying financial foundations remain surprisingly fragile despite their role as active wealth-builders. Nearly two-thirds, or 65 per cent, of Gen Z respondents find themselves exactly one health crisis away from outright financial instability.
While the remaining 35 per cent believe they are fully protected through parental coverage or existing employer policies, the majority are effectively under-protected. This specific segment looks wealthy on paper due to expanding investment portfolios, but a single significant health event would derail their financial trajectory entirely.
Venkatesh Naidu, CEO of Bajaj Capital Insurance Broking Ltd, stated, "The data tells us something we suspected but now see clearly: India is insuring itself, but not at the velocity or adequacy the risk environment demands. Young people save aggressively but protect cautiously."
He further noted, "Women are financially independent yet dependent on others for insurance decisions. And across all groups, the cost of protection in a real crisis far exceeds what families believe their policies cover."
The report noted that the decision to postpone insurance reflects a lower perceived urgency rather than an outright rejection of the system. Compared to mutual funds that provide visible returns and an ongoing sense of financial progress, insurance feels less immediate to young adults because the core value emerges only when a claim is made.
Consequently, personal insurance is deferred for five to seven critical years until the protection needs feel tangible. As per the report, 24 per cent stated they would use fixed deposits or savings, 14 per cent would borrow from family, 9 per cent would liquidate investments at unfavorable terms, and 6 per cent would take loans.
"This is not a knowledge crisis. It is a confidence crisis, an autonomy crisis, an advice crisis, and a design crisis. All three are solvable," Naidu said.
The report highlighted that Gen Z approaches money with sophistication, understands market returns, and handles volatility well. However, the pattern completely inverts regarding insurance, where reliance on others and assumption-based acceptance dominate.
— ANI
Reader Comments
Honestly, this is so true for most of my friends. We all track finfluencers on Instagram and watch every YouTube video on investing, but insurance feels so boring and complicated. The premium just seems like wasted money when you don't see returns. But I guess that's the point, right? It's not an investment, it's protection. Still, I wish Bajaj Capital would make policies simpler and more transparent, maybe then more people our age would actually buy them.
This is a classic Indian problem tbh. We're taught to save and invest from a young age, but insurance is seen as something our parents take care of. I'm 29, I have a good portfolio of stocks and mutual funds, but my health cover is only from my employer. If I lose my job, I'm completely exposed. The 65% figure about being one health crisis away from instability is shocking but not surprising. We need to change this mindset urgently.
I agree with the report that it's a 'confidence crisis' more than anything. I earn well and have savings, but when I try to research insurance policies, I get overwhelmed with jargon, hidden terms, and so many options. Meanwhile, my SIP gives me a 12% return this year, so I feel good about it. Insurance feels like I'm just throwing money away until I actually need it. Maybe the industry needs to design products that feel more relevant to our lifestyle, like micro-insurance or apps that show how much we're protected in real-time.
Interesting report. As an expat living in India, I've noticed this cultural difference. Back home in the US, getting health insurance is often a mandatory part of adulting from day one. Here, many young Indians seem to see it as optional until a crisis hits. The stat about 24% using fixed deposits for emergencies is risky, especially with inflation. I respect the savings discipline, but the protection gap is real
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